Public-Private Partnership (PPP) describes a government service or private business venture which is funded and operated through a partnership of government and one or more private sector companies.

In 2005 & 2006, the Government of Indonesia organized Indonesia Infrastructure Summit in Jakarta to promote the concept of Public Private Partnerships (PPP) and to attract private investor cooperation in the provision of infrastructures (such as toll roads, electricity, airports and so on) in Indonesia.

In January 2011 IIGF/PII launches IDR 30 trillion guarantee for coal-fired power plant in Central Java

In May 2011 a consortium of Electric Power Development Co (J-Power), coal miner Adaro Energy and Itochu Corporation was the preferred bidder to develop a coal power plant in Central Java

On 6 October 2011 a Public Private Partnership (PP ) was signed to develop a steam power generation project of 2×1000 MW. Details of this cooperation include:
1. Power Purchase Agreement between PT PLN (Persero) with
private power developer PT Bhimasena Power Indonesia ”PT BPI”;
2. Guarantee Agreement between the RI Minister of Finance and PT PII (Persero) as guarantor, with private power developer PT BPI;
3. Recourse Agreement between the RI Minister of Finance as guarantor with PT PLN (Persero);
4. Recourse Agreement between PT PII (Persero) as guarantor and PT PLN (Persero);
5. Sponsor Agreement to develop projects between J-Power, Itochu and Adaro.
The Central Java PP steam power plant project is the first large-scale showcase PP project with an investment value of over Rp30 trillion. This PPP project is being implemented based on Presidential Regulation No. 67/2005 regarding Government Cooperation with Business Entities for the Provision of Infrastructure. In 2006, the Government determined the Central Java steam power plant project as a model for the PPP project. Alongside, this project is also included in the Master Plan for Acceleration and Expansion of Indonesia’s Economic Development (MP3EI) and is a showcase model for PP as
proclaimed by the Government in 2010.

GUARANTEE FRAMEWORK FOR PLN PPP PROJECT

POTENTIAL PROJECTS:

Conformity with the national / regional mid term development plan and the infrastructure sector’s strategic plan;

Conformity of the project’s location with the Regional Spatial Planning;